Police in central China detained five people and four officials were reprimanded after a construction firm reportedly employed HIV/AIDS sufferers to scare residents into vacating their houses, the state news agency reported on Saturday.
Forced demolitions are a frequent cause of unrest and anger in China, with local governments and developers often accused of using thugs to carry out demolition orders and of not paying proper compensation.
The government of Nanyang in the central province of Henan had previously confirmed the team's existence, but denied they were hired by the local government.
The four officials, including three from the Nanyang city housing bureau, were given disciplinary warnings for dereliction of duty, Xinhua said.
The case, which has been widely publicised on social media, has caused an outcry in China.
Xinhua reported that the team of six alleged HIV sufferers was recruited by a local company leading a demolition project to get residents to leave their houses.
The six allegedly brandished official identity cards identifying them as having HIV/AIDS, set off firecrackers outside the residents' houses and shot steel ball bearings at windows with slingshots, Xinhua said.
It was not immediately clear if those arrested were members of the team or the construction company that hired them.
Many HIV sufferers in China were infected through poorly controlled blood infusions at hospitals or by selling their blood on the black market.
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